AAFX TRADING

Daily Market Lookup

  • The dollar headed for its best week in a month on Friday as a resurgence in coronavirus cases knocked confidence in a rapid economic recovery and drove investors to the safety of the world's reserve currency. Geopolitical tensions on the Korean peninsula, in the Himalayas and between China and its trading partners have also weighed, and the balance of risks kept morning moves modest. President Donald Trump on Thursday renewed his threat to cut ties with China, a day after the first high-level talks between the countries in months amid souring relations. The meeting, between top diplomats in Hawaii, was inconclusive. Meanwhile an uptick in coronavirus cases in many U.S. states this week, along with rising hospitalisations, reflected a troubling national trend that has seen daily infection numbers climbing after more than a month of declines. More than 150 new cases have also been detected in Beijing since last week, prompting a lift in the city's alert level and a reintroduction of travel curbs. The British pound sat a fraction above a two-week low at $1.2403, under pressure as investors fretted that the Bank of England may not be planning enough bond buying to support confidence through 2021. A mixed bag of U.S. economic data overnight also gave investors pause for thought, with a rebound in Atlantic-coast manufacturing offset by weak labour figures. It has lost about 1.3% of its value against the dollar since a Tuesday top as questions grow about the political viability of the European Union's stimulus plan. The bloc's 27 national heads join a video conference from 0800 GMT to try and reach an agreement on the best way forward for a region that has lost over 100,000 lives to the pandemic, and faces an unprecedented economic downturn. Investors are also keeping a wary eye on Australian trade ties, as relations strain with its biggest trading partner, China, over the handling of the coronavirus outbreak.
  • The dollar was down on Friday morning in Asia, ending the week by giving up some of its earlier gains. Investors will continue to monitor the rising number of COVID-19 cases in Beijing and the U.S., with the number of cases stemming from an outbreak at Xinfadi market almost at 200. Simmering U.S.-China tensions will be another focal point in the aftermath of U.S. President Donald Trump warning on Thursday that cutting ties with China remains a possibility. The GBP/USD pair gained 0.03% to 1.2428, with the GBP boosted by the Bank of England’s quantitative easing program announced on Thursday. But investors were concerned that the program could be insufficient to support confidence into 2021.
  • Oil prices pushed higher in early trade on Friday, building on gains in the previous session, after OPEC producers and allies promised to meet their supply cut commitments and two major oil traders said demand was recovering well. Plans by Iraq and Kazakhstan to make up for overproduction in May on their supply cut commitments supported the market. The promises came out of a meeting by a panel monitoring compliance by the Organization of Petroleum Exporting Countries and its allies, a grouping called OPEC+. If the laggard producers do compensate over the next three months for their overproduction, that will effectively take extra barrels out of the market, even if OPEC+ does not extend its record 9.7 million barrels per day supply cut beyond July. Near-term optimism around those make-up supply cuts easing pressure on storage helped tip Brent into 'backwardation' on Thursday for the first time since early March, with the August contract rising to 9 cents above September on Friday. Backwardation occurs when near-term contracts are trading at higher prices than outer months, due to abnormal circumstances. Normally oil futures trade in 'contango', with the outer months at higher prices, reflecting the cost of holding oil. Fears about dwindling storage capacity had sent the market into steep contango, as wide as $5, as coronavirus lockdowns hit demand and Saudi Arabia and Russia glutted the market with crude in April. Oil was up on Friday morning in Asia, finishing the week by adding to gains from the previous session. Oil prices continue to be boosted by the outcome of Thursday’s OPEC-chaired panel to monitor compliance to OPEC+ members’ pledged cuts in April. Iraq and Kazakhstan, two of the countries who struggled to meet their target cuts, announced plans to compensate for their overproduction in May. Investors are hopeful that the two countries will stick to their plan, which would take extra barrels out of the global supply, and allay an oversupply even if the OPEC+ cuts are not extended beyond their current expiry at the end of July. Vitol Chief Economist Giovanni Serio told the press, “Our short-term tracking of demand confirms a healthy demand recovery from the lows of April...China led the recovery in April and May and in the past couple of weeks, U.S. and European countries have followed.” But other investors were skeptical of a big push higher for the black liquid.

 

 
Intraday RESISTANCE LEVELS
19th June 2020 R1 R2 R3
GOLD-XAU 1,740-1,748 1,754 1,760-1,770
Silver-XAG 18.00-18.55 18.95 19.60-20.10
Crude Oil 39.50 40.50 41.00-42.00
EURO/USD 1.1300-1.1360 1.1400 1.1450-1.1500
GBP/USD 1.2470-1.2550 1.2600 1.2650-1.2720
USD/JPY 107.40-107.90 108.40 109.40-110.20

Intraday SUPPORTS LEVELS
19th June 2020 S1 S2 S3
GOLD-XAU 1,720-1,704 1,690 1,675-1,664
Silver-XAG 17.25-16.90 16.30 16.00-15.55
Crude Oil 38.90-37.90 37.10 36.00-34.90
EURO/USD 1.1205 1.1150 1.1090-1.1030
GBP/USD 1.2410-1.2320 1.2240 1.2165-1.2100
USD/JPY 106.50 105.50 105.00-104.30

Intra-Day Strategy (19th June 2020)
GOLD-XAU Buy on Dips
Silver-XAG Buy on Dips
Crude Oil Neutral to Buy
EUR/USD Neutral to Buy
GBP/USD Neutral to Sell
USD/JPY Neutral to Sell

Gold – XAU

AAFX TRADING

Gold on Thursday made its intraday high of US$1737.35/oz and low of US$1717.30/oz. Gold down 0.208% at US$1721.96/oz.

Technicals in Focus:

In daily charts, prices are above 50DMA (1642) and breakage below will call for 1600. MACD is above zero line and histograms are also increasing trend and it will bring upward stance in the upcoming sessions. RSI is in neutral region and more upside is expected before it gets stretched. Stochastic Oscillator is in oversold territory and giving negative crossover to bearish stance for intraday trade.

Trading Strategy: Buy on Dips

Based on the charts and explanations above; buy above 1720-1670 with risk below 1670, targeting 1740-1748 and 1654-1660. Sell below 1740-1770 keeping stop loss closing above 1770, targeting 1729-1704-1690 and 1674-1664.

 
Intraday Support Levels
S1     1,720-1,704
S2     1,690
S3     1,675-1,664
Intraday Resistance Levels
R1     1,740-1,748
R2     1,754
R3     1,760-1,770

Technical Indicators

Name   Value Action
14DRSI  

55.982

Buy
20-DMA   1723.18 Sell
50-DMA  

1705.61

Sell
100-DMA   1648.90 Buy
200-DMA   1573.51 Buy
STOCH(5,3)   87.621 Sell
MACD(12,26,9)   4.894 Sell

Silver - XAG

AAFX TRADING

Silver on Thursday made its intraday high of US$17.66/oz and low of US$17.29/oz settled down by 0.584% at US$17.34/oz.

Technicals in Focus:

On daily charts, silver is sustaining above 200DMA (16.93), breakage below will lead to 16.30. MACD is above zero line and histograms are increasing trend and it will bring bullish stance in the upcoming sessions. RSI is approaching overbought region, indicating buy signal for now. The Stochastic Oscillator is in oversold region and giving negative crossover to show downside move for the intraday trade.

Trading Strategy: Buy on Dips

On daily charts, silver is sustaining above 200DMA (16.93), breakage below will lead to 16.30. MACD is above zero line and histograms are increasing trend and it will bring bullish stance in the upcoming sessions. RSI is approaching overbought region, indicating buy signal for now. The Stochastic Oscillator is in oversold region and giving negative crossover to show downside move for the intraday trade.

 
Intraday  Support Levels
S1     17.25-16.90
S2     16.30
S3     16.00-15.55

Intraday  Resistance Levels
R1     18.00-18.55
R2     18.95
R3     19.60-20.10

TECHNICAL INDICATORS
Name   Value Action
14DRSI   53.514 Buy
20-DMA   17.52 Buy
50-DMA   16.24 Buy
100-DMA   16.25 Buy
200-DMA   16.89 Buy
STOCH(5,3)   29.268 Sell
MACD(12,26,9)   -0.541 Buy

Oil - WTI

AAFX TRADING

Crude Oil on Thursday made an intra‐day high of US38.95/bbl, intraday low of US$37.42/bbl and settled up by 0.624% to close at US$38.05/bbl.

Technicals in Focus:

On daily charts, oil is sustaining below its 50DMA i.e. 40.00 which is a resistance level and breakage above will call for 44.00. MACD is below zero line and histograms are in increasing mode will bring bullish stance in the upcoming sessions. The Stochastic Oscillator is in overbought region and giving positive crossover for confirmation of bullish stance; while the RSI is in neutral region and more downside can be expected to reach the oversold region, which is highly probable.

Trading Strategy: Neutral to Buy

Based on the charts and explanations above; buy above 38.10-34.00 with risk daily closing below 34.00 and targeting 38.90-39.50-40.10 and 41.00-42.00. Sell in between 38.90-42.10 with stop loss at 42.10; targeting 38.00-37.10-36.00 and 34.90-33.90-33.00.

 
Intraday Support Levels
S1     38.90-37.90
S2     37.10
S3     36.00-34.90

Intraday Resistance Levels
R1     39.50
R2     40.50
R3     41.00-42.00

TECHNICAL INDICATORS
Name   Value Action
14DRSI   65.03 Sell
20-DMA   36.25 Buy
50-DMA   28.91 Buy
100-DMA   34.39 Buy
200-DMA   45.77 Sell
STOCH(5,3)   64.130 Buy
MACD(12,26,9)   2.453 Sell

EUR/USD

AAFX TRADING

EUR/USD on Thursday an intraday low of US$1.1184/EUR, high of US$1.1260/EUR and settled the day down by 0.337% to close at US$1.1204/EUR.

Technicals in Focus:

On daily charts, prices are sustaining below 100DMA (1.1031), which become immediate resistance level, break above will target 1.1090. MACD is below zero line but histograms are increasing mode which will bring bullish view. Stochastic is in oversold territory and giving negative crossovers to signal for bearish outlook for intraday. 14D RSI is currently in neutral region and giving no directions to consider right now.

Trading Strategy: Neutral to Buy

Buy above 1.1200-1.1030 with risk below 1.1030, targeting 1.1300-1.1360-1.1400 and 1.1450-1.1495. Sell below 1.1300-1.1495 targeting 1.1235-1.1190-1.1150 and 1.1090-1.1020 with stop-loss at daily closing above 1.1500.

 
Intraday Support Levels
S1     1.1205
S2     1.1150
S3     1.1090-1.1030

Intraday  Resistance Levels
R1     1.1300-1.1360
R2     1.1400
R3     1.1450-1.1500

TECHNICAL INDICATORS
Name   Value Action
14DRSI   58.032 Buy
20-DMA   1.1187 Buy
50-DMA   1.0996 Buy
100-DMA   1.0984 Sell
200-DMA   1.1025 Sell
STOCH(5,3)   23.758 Sell
MACD(12,26,9)   -0.0011 Buy

GBP/USD

AAFX TRADING

GBP/USD on Thursday made an intra‐day low of US$1.2401/GBP, high of US$1.2566/GBP and settled the day down by 0.267% to close at US$1.2423/GBP.

Technicals in Focus:

On daily charts, prices are sustaining below 200DMA (1.2647) is become major resistance level. 14-D RSI is currently in neutral region and direction is difficult to predict on RSI bases. The Stochastic Oscillator is in oversold territory and giving negative crossover to confirm bearish stance. MACD is above zero line but histograms are increasing lead to upward movement.

Trading Strategy: Neutral to Sell

On daily charts, prices are sustaining below 200DMA (1.2647) is become major resistance level. 14-D RSI is currently in neutral region and direction is difficult to predict on RSI bases. The Stochastic Oscillator is in oversold territory and giving negative crossover to confirm bearish stance. MACD is above zero line but histograms are increasing lead to upward movement.

 
Intraday Support Levels
S1     1.2410-1.2320
S2     1.2240
S3     1.2165-1.2100

Intraday Resistance Levels
R1     1.2470-1.2550
R2     1.2600
R3     1.2650-1.2720

TECHNICAL INDICATORS
Name   Value Action
14DRSI  

47.554

Buy
20-DMA   1.2511 Buy
50-DMA   1.2423 Buy
100-DMA   1.2507 Sell
200-DMA   1.2682 Sell
STOCH(5,3)   19.940 Sell
MACD(12,26,9)   -0.0305 Sell

USD/JPY

AAFX TRADING

USD/JPY on Thursday made intra‐day low of JPY106.66/USD and made an intraday high of JPY107.12/USD and settled the day down by 0.0261% at JPY106.96/USD.

Technicals in Focus:

In daily charts, JPY is sustaining above 200DMA (108.30), which is initial support on the daily chart. 14-D RSI is currently in overbought region and chances of downward are expected based on RSI. MACD is above zero line but histograms are in decreasing mode which might lead to downward movement. The Stochastic Oscillator is in neutral territory and signaling to sell as it has given negative crossover to confirm bearish stance.

Trading Strategy: Neutral to Sell

Sell below 107.50-111.00 with risk above 111.00 targeting 106.90-106.20-105.60 and 105.00-104.50. Long positions above 106.90-104.00 with targets of 107.90-108.40 and 109.40-110.20-110.90 with stop below 105.00.

 
Intraday Support Levels
S1     106.50
S2     105.50
S3     105.00-104.30

INTRADAY RESISTANCE LEVELS
R1     107.40-107.90
R2     108.40
R3     109.40-110.20

TECHNICAL INDICATORS
Name   Value Action
14DRSI   46.904 Buy
20-DMA   107.85 Buy
50-DMA   107.53 Sell
100-DMA   108.13 Sell
200-DMA   108.41 Buy
STOCH(9,6)   37.253 Sell
MACD(12,26,9)   -0.161 Sell

AAFX TRADING
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